Hi Tonya, welcome to the community
To answer the question about payments, etc. you can accept credit cards through a PayPal business account, if that is how your clients wish to pay. But the nice thing about PayPal is that they can pay from other funding sources as well, making it a nice and easy method to offer. There is also a new system we've just heard about on the forums called the Intuit Payment Network, their fees are apparently lower than PayPal [much lower] and it is sounding like a great option as well, especially for higher-end payments where the PayPal fees would be really nuts. [Use the search feature in the main menu of the site to look up threads on both companies and see what others have to say].
For information on state and federal business tax regulations, check out the section of the forums devoted to
Taxes. That's also a great place to ask your question and get more direct feedback.
Wishing you success!